Following a review to ensure that its energy lending criteria reflects EU energy and climate policy, as well as current investment trends, the EIB will focus on financing energy efficiency, renewable energy, energy networks, as well as related research and innovation.

According to the bank, these sectors are expected to require the most significant investment in coming years.

The new energy lending criteria includes streamlined guidelines for lending for energy efficiency projects to enhance co-financing of national energy efficiency programmes and enable increased support for near-zero energy buildings.

EIB vice president responsible for energy lending, Mihai Tanasescu, said: “Adoption of the new lending criteria represents an important step forward in the European Investment Bank’s commitment to energy investment that supports EU policy and reflects the urgent investment challenges currently facing the energy sector.

“Prioritising lending to energy efficiency, renewable energy, energy networks and energy RDI projects will help EU to meet its energy and climate objectives and create local employment across Europe.

“The new Emissions Performance Standard will ensure that outside these sectors the Bank’s energy lending makes a sustainable and positive contribution to economic growth.” said Mihai Tanasescu, European Investment Bank Vice President responsible for energy lending,” he said.

European Commissioner for Energy, Günther Oettinger, added: “Significant long-term investment across Europe is essential to achieve our energy and climate targets and maintain a technological lead. The European Investment Bank plays a valuable role in financing public and private sector investment in energy infrastructure and supporting projects that contribute to achieving EU energy policy goals. The new guidelines provide a framework for continuing this contribution over the years ahead”.

In addition, the EIB is introducing a new Emissions Performance Standard to be applied to all fossil fuel generation projects to screen out investments whose carbon emissions exceed a threshold level, which comes under EU and national commitments to limit carbon emissions.

The board agreed that the Emissions Performance Standard would be kept under review and that more restrictive commitments could be considered in the future.

Gas is expected to remain a transition fuel to a low carbon energy system, and the Emissions Performance Standard will ensure that lending is restricted to projects that make a positive contribution to EU economic growth and are consistent with EU climate policy.

Over the last five years EIB lending to power generation projects using fossil fuels declined significantly and during this period lending to coal and lignite power stations represented less than 1.5% of overall energy lending.

Environmental groups welcomed the move but urged other financial institutions to follow the EIB’s lead and “shape the world’s shift to sustainable energy sources”.

Economist at WWF’s European Policy Office, Sebastien Godinot, said: “The move by the EIB is very welcome but more needs to be done. To have a serious chance at staying within the 2°C climate change limit in Europe by 2050, the EIB should strengthen its standards and eventually phase out its support for all power supply based on fossil fuels.

“Coal is the dirtiest of fossil fuel power sources – polluting local environments, impacting on people’s health and contributing heavily to climate change. It is now time for all international Financial Institutions and especially the European Bank for Reconstruction and Development [3], to follow the EIB’s example, and to clean up their acts too.”

Leigh Stringer

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